Attached files
| file | filename |
|---|---|
| 8-K - FORM 8-K - TRANSCONTINENTAL REALTY INVESTORS INC | d82366e8vk.htm |
Exhibit 99.1
NEWS RELEASE |
||
FOR IMMEDIATE RELEASE
|
Contact: | |
| Transcontinental Realty Investors, Inc. | ||
| Investors Relations | ||
| (800) 400-6407 | ||
| investor.relations@primeasset.com |
Transcontinental Realty Investors, Inc. Reports First Quarter 2011 Results
DALLAS (May 16, 2011) — Transcontinental Realty Investors, Inc. (NYSE: TCI), a Dallas-based real
estate investment company, today reported results of operations for the first quarter ended March
31, 2011. TCI announced today that the Company reported a net loss applicable to common shares of
$12.2 million or $1.49 per diluted earnings per share, as compared to a net loss applicable to
common shares of $10.5 million or $1.30 per diluted earnings per share for the same period ended
2010.
Rental and other property revenues were $31.3 million for the three months ended March 31, 2011.
This represents a decrease of $1.3 million, as compared to the prior period revenues of $32.6
million. The change, by segment, is a decrease in the commercial portfolio of $2.2 million, a
decrease in the land and other portfolios of $0.1 million, offset by an increase in the apartment
portfolio of $1.0 million. Within the apartment portfolio, the developed apartments had an increase
of $0.5 million and the same properties had an increase of $0.5 million. Within the commercial
portfolio, the same property portfolio decreased by $2.2 million due to an increase in vacancy,
which we attribute to the current state of the economy. We have directed our efforts to apartment
development and put some additional land projects on hold until the economic conditions turn
around. We are also continuing to market our properties aggressively to attract new tenants and
strive for continuous improvement of our properties in order to maintain our existing tenants.
Mortgage and loan interest was $14.2 million for the three months ended March 31, 2011. This
represents a decrease of $1.3 million, as compared to the prior period interest expense of $15.5
million. This change, by segment is a decrease in the commercial portfolio of $0.6 million, a
decrease in the apartment portfolio of $0.4 million and a decrease in the other portfolio of $0.6
million, offset by an increase in the land portfolio of $0.3 million. The commercial portfolio
experienced a reduction in interest expense due to a matured loan that is being negotiated at a
lower interest rate. The decrease in the apartment portfolio is primarily due to loans that were
refinanced in 2010 at a lower interest rate. The decrease in the other portfolio is due to a
decrease in interest expense on loan amounts due to our advisor.
Provision
for impairment was $6.1 million for the three months ended March 31, 2011. Impairment was
recorded as an additional loss of $0.9 million in the commercial properties we currently hold and
$5.2 million in the apartments we currently hold.
Gain on
land sales increased for the three months ended March 31, 2011 as compared to the prior
period. In the current period we sold 191.99 acres of land in 10 separate transactions for an
aggregate sales price of $42.8 million and recorded a gain of $0.8 million. In the prior period,
we sold 0.275 acres of land in one transaction for an aggregate sales price of $8,984 and recorded
a gain of $6,470.
Included in discontinued operations are a total of two and 15 properties for 2011 and 2010,
respectively. The gain on sale of the properties is also included in discontinued operations for
those years.
About Transcontinental Realty Investors, Inc.
Transcontinental Realty Investors, Inc., a Dallas-based real estate investment company, holds a
diverse portfolio of equity real estate located across the U.S., including office buildings,
apartments, shopping centers and developed and undeveloped land. The Company invests in real
estate through direct equity ownership and partnerships nationwide. For more information, visit
the Company’s website at
www.transconrealty-invest.com.
TRANSCONTINENTAL REALTY INVESTORS, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited)
CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited)
| For the Three Months Ended | ||||||||
| March 31, | ||||||||
| 2011 | 2010 | |||||||
| (dollars in thousands, except share | ||||||||
| and per share amounts) | ||||||||
Revenues: |
||||||||
Rental and
other property revenues (including $372 and $858 for the
three months ended 2011 and 2010
respectively from affiliates and related parties) |
$ | 31,335 | $ | 32,651 | ||||
Expenses: |
||||||||
Property
operating expenses (including $349 and $452 for the three months
ended 2011 and 2010
respectively from affiliates and related parties) |
17,769 | 18,581 | ||||||
Depreciation and amortization |
6,622 | 6,416 | ||||||
General and administrative (including $842 and $891 for the three months
ended 2011 and 2010
respectively from affiliates and related parties) |
2,155 | 1,826 | ||||||
Provision on impairment of notes receivable and real estate assets |
6,059 | — | ||||||
Advisory fee to affiliate |
2,620 | 3,097 | ||||||
Total operating expenses |
35,225 | 29,920 | ||||||
Operating income (loss) |
(3,890 | ) | 2,731 | |||||
Other income (expense): |
||||||||
Interest income (including $317 and $653 for the three months ended 2011
and 2010 respectively from
affiliates and related parties) |
426 | 859 | ||||||
Other income |
1,467 | 664 | ||||||
Mortgage and loan interest (including $298 and $839 for the three months
ended 2011 and 2010
respectively from affiliates and related parties) |
(14,246 | ) | (15,531 | ) | ||||
Earnings
from unconsolidated subsidiaries and investees |
(61 | ) | (60 | ) | ||||
Total other expenses |
(12,414 | ) | (14,068 | ) | ||||
Loss before gain on land sales, non-controlling interest, and tax |
(16,304 | ) | (11,337 | ) | ||||
Gain on land sales |
796 | 6 | ||||||
Loss from continuing operations before tax |
(15,508 | ) | (11,331 | ) | ||||
Income tax benefit |
1,211 | 495 | ||||||
Net loss from continuing operations |
(14,297 | ) | (10,836 | ) | ||||
Discontinued operations: |
||||||||
Income (loss) from discontinued operations |
(217 | ) | 1,277 | |||||
Gain on sale of real estate from discontinued operations |
3,677 | — | ||||||
Income tax expense from discontinued operations |
(1,211 | ) | (447 | ) | ||||
Net income from discontinued operations |
2,249 | 830 | ||||||
Net loss |
(12,048 | ) | (10,006 | ) | ||||
Net (income) loss attributable to non-controlling interest |
85 | (273 | ) | |||||
Net loss attributable to Transcontinental Realty Investors, Inc. |
(11,963 | ) | (10,279 | ) | ||||
Preferred dividend requirement |
(274 | ) | (262 | ) | ||||
Net loss applicable to common shares |
$ | (12,237 | ) | $ | (10,541 | ) | ||
Earnings per share — basic |
||||||||
Loss from continuing operations |
$ | (1.76 | ) | $ | (1.40 | ) | ||
Income from discontinued operations |
0.27 | 0.10 | ||||||
Net loss applicable to common shares |
$ | (1.49 | ) | $ | (1.30 | ) | ||
Earnings per share — diluted |
||||||||
Loss from continuing operations |
$ | (176 | ) | $ | (1.40 | ) | ||
Income from discontinued operations |
0.27 | 0.10 | ||||||
Net loss applicable to common shares |
$ | (1.49 | ) | $ | (1.30 | ) | ||
Weighted average common share used in computing earnings per share |
8,240,136 | 8,113,669 | ||||||
Weighted average common share used in computing diluted earnings per share |
8,240,136 | 8,113,669 | ||||||
Amounts attributable to Transcontinental Realty Investors, Inc. |
||||||||
Loss from continuing operations |
$ | (14,212 | ) | $ | (11,109 | ) | ||
Income from discontinued operations |
2,249 | 830 | ||||||
Net loss |
$ | (11,963 | ) | $ | (10,279 | ) | ||
TRANSCONTINENTAL
REALTY INVESTORS, INC.
CONSOLIDATED BALANCE SHEETS
(unaudited)
CONSOLIDATED BALANCE SHEETS
(unaudited)
| March 31, | December 31, | |||||||
| 2011 | 2010 | |||||||
| (dollars in thousands, except share and | ||||||||
| par value amounts) | ||||||||
Assets |
||||||||
Real estate, at cost |
$ | 1,012,213 | $ | 1,074,635 | ||||
Real estate subject to sales contracts at cost, net of depreciation ($65,676 for 2011 and $58,579 for 2010) |
258,347 | 232,495 | ||||||
Less accumulated depreciation |
(94,873 | ) | (94,016 | ) | ||||
Total real estate |
1,175,687 | 1,213,114 | ||||||
Notes and interest receivable |
||||||||
Performing
(including $60,381 in 2011 and $66.011 in 2010 from affiliates and
related parties) |
64,786 | 71,766 | ||||||
Less allowance for estimated losses (including $3,061 in 2011 and 2010 from affiliates and related
parties) |
(4,741 | ) | (4,741 | ) | ||||
Total notes and interest receivable |
60,045 | 67,025 | ||||||
Cash and cash equivalents |
6,687 | 11,259 | ||||||
Investments in unconsolidated subsidiaries and investees |
7,842 | 8,146 | ||||||
Other assets |
73,532 | 85,217 | ||||||
Total assets |
$ | 1,323,793 | $ | 1,384,761 | ||||
Liabilities and Shareholders’ Equity |
||||||||
Liabilities: |
||||||||
Notes and interest payable |
$ | 780,270 | $ | 831,322 | ||||
Notes related to subject to sales contracts |
214,550 | 190,693 | ||||||
Affiliate payables |
33,032 | 47,261 | ||||||
Deferred revenue (from sales to related parties) |
87,000 | 89,132 | ||||||
Accounts payable and other liabilities (including $1,694 in 2011 and $1,466 in 2010 from affiliates
and related parties) |
40,792 | 49,196 | ||||||
| 1,155,644 | 1,207,604 | |||||||
Shareholders’ equity: |
||||||||
Preferred
stock, Series C: $.01 par value, authorized 10,000,000 shares, issued and outstanding 30,000
shares in 2011 and 2010 respectively (liquidation preference $100 per share). Series D: $.01 par value,
authorized, issued and outstanding 100,000 shares in 2011 and 2010 respectively |
1 | 1 | ||||||
Common
stock, $.01 par value, authorized 10,000,000 shares; issued 8,413,669 and 8,113,669 for 2011
and 2010 and outstanding 8,413,469 and 8,113,469 for 2011 and 2010 |
84 | 81 | ||||||
Treasury stock at cost; 200 shares in 2011 and 2010 |
(2 | ) | (2 | ) | ||||
Paid-in capital |
264,072 | 261,072 | ||||||
Retained earnings |
(113,877 | ) | (101,914 | ) | ||||
Total Transcontinental Realty Investors, Inc. shareholders’ equity |
150,278 | 159,238 | ||||||
Non-controlling interest |
17,871 | 17,919 | ||||||
Total equity |
168,149 | 177,157 | ||||||
Total liabilities and equity |
$ | 1,323,793 | $ | 1,384,761 | ||||
The accompanying notes are an integral part of these consolidated financial statements.